Fresh Del Monte pushes fresh-cut products and non-retail bananas

Fresh Del Monte Produce Inc. had a “year of contrast” in 2013, reporting an increase in net sales at $3.7 billion but a net loss for the year of almost $40 million.

“While we did not accomplish all of our financial goals, we realized an 8% increase in net sales for the year and a 30% increase for the fourth quarter,” chairman and chief executive officer Mohammad Abu-Ghazaleh said during a conference call Feb. 18.

“However, we faced a number of challenges in the fourth quarter and that hindered our financial performance with increased ocean freight and fruit costs being the heaviest factors.”

The CEO said he was optimistic the company’s efforts with non-retail channels for North American banana sales and overall sales of fresh-cut products would help over the long term. He said the company is becoming more vertically integrated with bananas by decreasing third-party grower contracts, which account for about 40% of its bananas now.

“We have found new avenues for selling and marketing our bananas really through different channels, and not just being focused on retail,” said Abu-Ghazaleh during the call. “This has helped us over the last couple of years in expanding our banana supplies and volumes into the U.S. market.”

He also said Fresh Del Monte is growing its prepared foods business, but has a focus on fresh-cut products. He said the company is open to acquiring operations in the fresh-prepared sector.

According to senior vice president Richard Contreras, fourth-quarter statistics include:

Tomato net sales increased 19% to $18 million. Volume increased 14% and pricing was 4% higher. The company expects to start seeing sales from Florida/Virginia tomato operations — bought at auction from East Coast Brokers and Packers Inc. — in the second quarter.

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About the Author:

Coral Beach, Staff Writer

Coral Beach joined The Packer newsroom in February 2011, bringing more than 30 years of experience at daily newspapers, trade magazines and online publications. Beach earned a bachelor’s of science degree from the University of Kansas School of Journalism in 1982.
e-mail: cbeach@thepacker.com
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